Only 28 percent of APAC manufacturers have a full digital strategy in place

Nurdianah Md Nur |
Oct. 12, 2017

The Microsoft survey also reveals the four key pillars of APAC manufacturers' digital transformation strategies.

Credit: Storyblocks

Less than a third (28 percent) of business leaders in Asia Pacific's (APAC) manufacturing sector have a full digital strategy in place today, according to the Microsoft Asia Digital Transformation Survey.

This is despite the fact that 79 percent of the respondents said their organisations need to transform to a digital business to enable future growth.

The top three barriers to digital transformation faced by manufacturers in the region are the lack of digitally skilled workforce, lack of supporting government policies and ICT infrastructure, and cyberthreats and security concerns.

Commenting on cybersecurity concerns, Andrés Ortola, director of the Enterprise and Partners Group, Microsoft Singapore, said: "People don't use technology that they don't trust. This is a golden rule that applies to organisations and individuals alike as we live in a mobile-first and cloud-first world. Ensuring security, privacy, and compliance are thus key to enabling manufacturing organisations to carry out digital transformation with confidence."

APAC manufacturers' digital transformation priorities

The study also revealed how business leaders in APAC's manufacturing sector are prioritising their digital transformation strategies.

The No.1 priority for most of them is to empower employees. To do so, organisations need to connect their employees to the information they need in their roles in order to be able to manage assets and processes in real time. This will enable organisations to innovate faster, and improve output while ensuring compliance requirements are met.

The second priority is to optimise their operations. They can achieve this by tapping on emerging technologies to gain insights and act on real-time intelligence to oprimise processes, performance and profitability.

Next is to engage with their customers. In this aspect, Microsoft advises manufactures to reimagine the client experience and transform itself from an asset-focused to a customer-centric entity so as to drive customer loyalty and profitability.

The final priority is to transform products and business models. Manufacturing organisations can drive agility with open and connected systems with highly-automated digital processes to support new product development in order to optimise distribution channel strategies, while meeting the security, privacy and transparency expectations of customers, regulators and shareholder, according to Microsoft.

Even though manufacturers in the region are taking various initiatives to transform, most are doing so incrementally, which is not enough to compete with more agile players, said Ortola. "The transformation of products and new revenue models provides the greatest opportunity for organisations to truly lead rather than be disrupted. Leaders need to rethink business models, find new data insights which lead to new revenue streams. And they need to do this by embracing a different way of bringing together people, data, and processes, which create value in a new digital business," he added.